By Arnold Maliba
The Kenya Revenue Authority (KRA) has officially beaten a hasty retreat on the controversial VAT “Special Table,” effectively ending its use as a broad enforcement and coercive compliance tool. Going forward, the Special Table will only be used to list taxpayers directly involved in VAT fraud schemes and the so-called missing trader arrangements.
The decision follows growing scrutiny and resistance, particularly from the Tax Appeals Tribunal, whose rulings had increasingly relieved taxpayers from being placed on the table. What had been presented as a compliance mechanism gradually became, in the eyes of many businesses, a punitive, manipulative, and coercive administrative weapon.
In an internal memo dated 10 March 2026, KRA itself admitted that the tool had been widely abused by its own officers. The authority acknowledged that the Special Table had evolved from a deterrent against tax fraud into the primary enforcement mechanism for compliance across multiple issues, often at the expense of legitimate businesses.
Yet the paradox remains, VAT collections rose significantly during the height of the Special Table regime. That success, however, came at the cost of fairness concerns and mounting legal challenges.
Through its rulings, the Tax Appeals Tribunal began building a strong and arguable jurisprudence questioning the legality and proportionality of the measure. Faced with the likelihood that the matter could escalate to the High Court of Kenya, where the authority risked losing outright, KRA appears to have chosen administrative retreat.
This does not mean enforcement tools will disappear. KRA will likely design new administrative mechanisms to ensure compliance and safeguard revenue. However, taxpayers will continue to place their hopes in the Tax Appeals Tribunal as an independent arbiter capable of balancing revenue collection with fairness and due process.
At the same time, there is a growing call for institutional reform in dispute resolution. The Martha Koome, as Chief Justice and head of the Judiciary of Kenya, should urgently establish a formal framework for court-annexed mediation in tax disputes to complement and supervise the existing Alternative Dispute Resolution (ADR) processes run by KRA, there is a huge Gap.
Currently, many taxpayers view the internal ADR system with suspicion, arguing that it has evolved into an opaque settlement channel where taxpayers are pressured into agreements that are reached after immense soliciting only for assessments to be reinstated later. Clear rules, judicial oversight, and transparency would restore confidence.
The retreat on the Special Table is therefore not merely an administrative adjustment, it is a reminder that tax enforcement must operate within the bounds of law, fairness, and accountability.
